Islamic banks’ financing growth to fall below 5pc: RAM

KARACHI RAM Ratings expects financing growth of Islamic banks to decline to below 5% in fiscal 2020, from 8.3% in 2019 due to the fallout from the Covid19 pandemic. Sophia Lee, RAM Ratings’ co-head of financial institution ratings said on Monday the decline tooked into account its expectation of a steep moderation of economic growth. RAM said the rapid spread of the Covid-19 pandemic and its far-reaching effects on the domestic and global economy, are anticipated to dampen credit demand and affect the performance of Islamic banks this year. The rating agency maintained a stable outlook on the Malaysian Islamic banking sector due to the industry’s sturdy fundamentals, although it cautioned that Islamic banks will face heightened uncertainties and challenges in the stillevolving economic landscape. —Agencies